The Canadian Surface Combatant (CSC) program will replace Canada’s aging destroyers and multi-role patrol frigates (the Navy’s Iroquois and Halifax class ships). The project is the largest procurement in Canadian history, with initial estimates placing it to worth around $26 Billion. As part of Canada’s National Shipbuilding Procurement Strategy, the CSC ships are set to built by Halifax’s Irving Shipbuilding, with the warship designer and combat systems integrator to be chosen in the coming months.
After much anticipation, the official RFP for the CSC program was released on October 27th, 2016, marking the beginning of the competition to select a warship designer and combat systems integrator for Canada’s new warships. Canada is looking to choose an existing Commercial off the Shelf (COTS) design and has combined the design and combat systems integration into one RFP. By utilizing an already proven design, the Government believes that the first ships will be delivered close to two years sooner than if Canada were to choose a new design.
Irving Shipbuilding is the Prime contractor for the CSC program and will choose the warship designer and combat systems integrator from a shortlist of pre-qualified bidders. The Government will oversee this process to ensure a fair and open competition.
The list of prequalified bidders includes:
- Alion-JJMA Corp. (U.S.).
- Lockheed Martin
- BAE Systems Surface Ships Ltd.
- Odense Maritime Technology
- ThyssenKrupp Marine Systems
Bidders will have six months to put together their full bid package, including identifying their Canadian partners and suppliers for the program. As for most large defence procurements, the Industrial and Technological Benefits (ITB) policy will apply and will require the winning bidder to spend the equal value of the contract price back into the Canadian economy, primarily through sourcing a Canadian supply chain.
As part of the ITB policy, all bidders will be required to submit a Value Proposition as a part of their bid. The Value Proposition will outline the bidder’s plans to bring high-value work to Canadian firms as a result of being awarded the CSC contract, including identified transactions with Canadian partners, investments in research and development and providing export opportunities to Canadian companies. Once awarded a contract, the bidder will be legally held to its identified commitments to invest in Canada and partner with Canadian companies. If you are interested in learning more about how Value Propositions work, click here. Many of the approved bidders have already been identifying Canadian partners to include in their Value Proposition over the past few months.
CSC has been designed to further develop Canadian industry and thus offers an exciting opportunity for Canadian companies, across industries, to be included. The bidders can include ITB transactions for both direct work for the CSC project and indirect work on other programs being undertaken by the bidders. Additionally, many of the required Market Segments offers opportunities to companies that may not typically work in defence. This allows for a broad range of companies, not traditionally in defence or shipbuilding, to benefit from the CSC procurement.
If you are interested in learning more about how the procurement works or how to be included on one of the bidder’s Value Propositions, please contact us.